A $100 billion increase in government spending increases Real GDP by $900 billion.Assuming a constant price level,what does the government spending multiplier equal?

Name: A $100 billion increase in government spending increases Real GDP by $900 billion.Assuming a constant price level,what does the government spending multiplier equal?
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Question

Quizplus · Accepted Answer

The government spending multiplier is calculated as the change in Real GDP divided by the change in government spending, which is $900 billion / $100 billion = 9.

A $100 Billion Increase in Government Spending Increases Real GDP